Make Income Tops on Boomer Retirement To-do List
(NUI) - As many Americans get better news in their financial statements, those closing in on retirement may be more confident asking the question, "Am I finally ready to enter the next phase of life after full-time work?" But for the baby boom generation, there are new retirement realities that should be addressed first.
Boomers have a better-than-average chance of living 20, 30 or more years past retirement age. At the same time, staying healthy is costing more. A couple retiring today will need at least $175,000 just to pay for out-of-pocket health care costs not covered by an employer plan, according to a recent report from Fidelity Investments.
Unlike previous generations whose company pensions, retiree health care plans and Social Security provided a core source of retirement income, boomers must take more control over their retirement destinies. However, many Americans today may be taking a blind leap into retirement without any blueprint for making savings last.
"Planning may not seem like fun, but it's the single most important thing boomers can do to help them live the life they want in retirement," said Cynthia Egan, Fidelity Investments. "For investors within five years of retirement or newly retired, developing a lifetime income plan should be at the top of any retirement to-do list."
To get started, investors should consider the following steps. First, shore up retirement savings by continuing to contribute the maximum to tax-advantaged retirement accounts like 401(k)s and IRAs. Special catch-up provisions allow workers over age 50 to save even more.
Begin a lifetime income plan by first estimating expenses. Then calculate how long savings will last and how much you can afford to draw down for monthly expenses. Finally, work with a trusted financial provider to build an investing strategy that generates income to cover expenses today, but also has the potential to grow over time.
Helpful worksheets, checklists, articles and a sophisticated, yet easy-to-use Web tool are available on the Retirement Resource Center at www.Fidelity.com/retire. Once online, investors can locate a nearby Fidelity investor center to attend a free educational seminar or arrange to meet with a retirement professional.
Article courtesy of www.newsusa.com.
